Coal India raises capex budget by 30% to Rs 13,000 crore for FY21

New Delhi: Coal India Limited (CIL) has raised its capital expenditure budget by 30% to Rs 13,000 crore for the ongoing fiscal amid government directions to all Central PSUs to step up their spend to stimulate economic activity.
The state-run miner’s capex target for 2020-21 was Rs 10,000 crore.

Of the additional Rs 3,000 crore injected into CIL’s capex budget, South Eastern Coalfields Ltd- the largest coal producing subsidiary of the company, accounts for Rs 800 crore followed by CIL headquarters with Rs 585 crore and Mahanadi Coalfields Ltd with Rs 550 crore, a company executive said. Central Coalfields Ltd will spend Rs 460 crore.

The major heads CIL has identified for capex are land acquisition, procurement of heavy earth moving machinery, upgrade of rail evacuation infrastructure and mine development.

CIL has posted 166% growth at Rs 7,801 crore during the first nine months of the fiscal ending December’20.

“CIL has utilized 78% of its total original capex budget during April-December’20. CIL was directed by the coal ministry to achieve Rs 7,500 crore capex utilisation by the closure of December’20 against which the actual capex utilization was Rs 7,801 crore,” the executive said.

CIL’s capex for the current year’s Q3, ending December’20, at Rs 2,778 crore posted a 90% growth against Rs 1,463 crore of the same quarter last year.

For Q2 of the current year CIL logged 312% capex growth and a growth of 86.5% in Q1. CIL’s capex during the current financial year makes it one of the top spenders among the Indian PSUs.

Coal India’s land possession and civil construction jobs, among other activities, were affected during the Covid -led slowdown. Subsequently, headway could be made with the situation improving post unlock, nudging its increased capital expenditure.

“CIL will be closely monitoring the progress of the capital expenditure to achieve the revised target of Rs 13,000 crore in the current FY,” said the executive.